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Costs of Inaction, etc. [Fast Track]
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Costs of Inaction, etc. [Fast Track]
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FOIA Number: 2017-0401-F
FOIA
MARKER
This is not a textual record. This is used as an
administrative marker by the William J. Clinton
Presidential Library Staff.
Collection/Record Group:
Clinton Presidential Records
Subgroup/Office of Origin:
Policy Development
Series/Staff Member:
Eric Biel
Subseries:
OA/ID Number:
10601
FolderID:
Folder Title:
Costs of Inaction, etc. [Fast Track]
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Section:
Shelf:
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S
100
1
5
3
Devised 9/29 aM
WHY AMERICA WON'T GET ITS FAIR SHARE OF JOBS WITHOUT FAST TRACK
The U.S. needs to maintain its leadership role in opening markets through tough, fair trade
agreements.
Since 1992, 49 states have experienced an increase in overall goods exports and 45
states have experienced an increase in jobs supported by trade.
46 states have higher exports to Mexico and 47 states have higher exports to
Japan.
America needs fast track to continue to create higher-paying jobs for more Americans. Without it,
America's role as the largest exporter in the world will be put in jeopardy. And with more markets
opening in the world, it is now more important than ever to give the President traditional trade
authority to break down trade barriers for American goods and services.
In the upcoming WTO negotiations, President Clinton needs fast track to have the flexibility to
negotiate agreements in agriculture, commercial services and government procurement. In each
of these areas, the U.S. is the most competitive nation in the world and stands to benefit the most from
writing the rules of trade.
AGRICULTURE
The U.S. is the world's largest agricultural exporting country -- shipping a record $60 billion in
exports abroad. In 1996, total world agricultural exports totaled $600 billion. U.S. exports accounted
for 10% of that -- $60 billion -- the highest ever.
U.S. agricultural exports support nearly a million jobs and this number is rising.
Since 1990, the value of U.S. agricultural exports has increased by $20 billion, or
nearly 50%. Each week last year, on average, American producers and processors
shipped out more than $1.1 billion in farm and food products to foreign markets.
Last year, our agricultural exports were twice the level of our agricultural imports
-- a claim no other industry sector can make. Dollar for dollar, we export more corn
than coal, more wheat than steel, more meat than aluminum and more fruits and
vegetables than CD's, records, and tapes. U.S. exports are growing more than three
times as fast as domestic demand for foods.
U.S. agriculture will pay a price if fast track is not granted.
ISP
More than 30 bilateral and regional trade agreements are already operating here
in the Western Hemisphere, and the U.S. is party to only one NAFTA. While
these preferential trade agreements multiply, the U.S. share of the region's total
agricultural imports is declining.
iss
Chile has already signed trade agreements with Bolivia, Colombia, Ecuador,
Mexico, Venezuela, MERCOSUR and most recently Canada. The U.S. has
already lost an estimated $500 million in exports to other countries that have
duty preferences already in place.
Chilean fresh fruit pays a 2% duty when entering Venezuela (due to the Chile-
Venezuela FTA) whereas American producers pay a 15% tariff. The U.S.
Embassy estimates that the U.S. market share would grow from its current 39%
to 67% if U.S. producers had equivalent access to the Venezuelan market.
(WE NEED MORE HERE)
Without fast track, the U.S. will lack credibility to push for a fast start on WTO
agricultural negotiations scheduled to start at the end of 1999. Agriculture remains one of
the most protected and subsidized sectors in the world economy. American exports still
continue to face trade barriers through high tariffs and preferential trade deals that exclude the
U.S. Already, since 1992, in Latin America and Asia alone, our competitors have
negotiated 20 trade agreements that do not include the United States.
Country:
Pre-Uruguay:
Post-Uruguay
Colombia
14.5%
10.9%
Brazil
21.8%
11.7%
Peru
27%
14.6%
Venezuela
15%
12.4%
Argentina
14.5%
10.4%
Uruguay
24%
14.6%
The best way we can continue to increase our agricultural exports and create more higher-
paying jobs is through broad negotiations where the U.S. has the ability to seek additional
commitments from other countries.
COMMERCIAL SERVICES
Exports of services by U.S. firms supported an estimated 3.9 million U.S. jobs in 1996. U.S.
service exports have more than doubled over the last ten years, increasing $135 billion since 1987 and
$84 billion since 1990 to $250 billion in 1996. In 1995, U.S. service exports accounted for 16% of
global service exports; our closest competitors that year were France (8%) and Germany, Italy, Japan
and the U.K. (between 5% and 6%).
U.S. exports to emerging markets have grown at impressive rates: nearly 30% to
China, Taiwan and Korea; and over 20% to Hong Kong and Argentina. The U.S. also
exported over $1 billion in 1995 to the emerging markets of Argentina, Brazil, China,
Hong Kong, the Philippines, India, Indonesia, Korea, Malaysia, Singapore and
Thailand.
Service exports are estimated to reach $300 billion by 2005 and $350 billion by
2010. With the expanding electronic commerce market, the growth trend in the service
sector may easily surpass these estimates. For example, look at the health care services
industry. In 1994, exports reached $812 million. The industry is estimated to grow to
$1.03 billion by 1998 and continue its growth to $1.4 billion by 2002.
Unless negotiated away, barriers will inhibit increased U.S. service exports. In
Korea, a number of service sectors remain restrictive for foreign investment, including
audio-visual services, insurance, telecommunications and advertising. Brazil has
restrictive investment laws, lack of transparency in administrative procedures and limits
on foreign capital participation. Distribution in the domestic market is restricted in
Indonesia.
Fast track will strengthen U.S. efforts to reduce trade barriers and expand
international markets, which will be key to maintain U.S. competitiveness and
innovation.
GOVERNMENT PROCUREMENT
$200 billion in U.S. exports in 1996, $600 billion total world market.
Korea: $20 billion civil aviation purchase planned
Thailand: $22 billion power plan purchase planned
Brazil: $10 billion in environment technologies purchase planned
Venezuela: $1.3 billion civil aviation purchase planned
ADDITIONAL SECTORS
Sector
Estimated US exports to World
Est. US exports to APEC
Chemicals:
$69.4 billion
$41.3 billion
Medical equipment:
$11.7 billion
$4.8 billion
Automotives
$98.4 billion
$71.2 billion
Telecomm equip
$11.4 billion
$7 billion
Environmental goods
$5.3 billion
$3.1 billion
Fish and fish products
$3 billion
$2.6 billion
Non-ferrous metals
$8.2 billion
$6.3 billion
Cival aircraft and parts
$29.4 billion
$14.8 billion
Energy Equipment
US exports to the world $15.5 billion in 1996
Environmental technologies and services
US exports to the world $14.5 billion in 1996, global
market estimated at $440 billion and growing
Russell W. Horwitz
09/28/97 07:07:48 PM
Record Type:
Record
Eric R. Biel/WHO/EOP, ustr.gov @ INET @ LNGTWY
mryckmark 539 LL
To:
CC:
Subject: a first attempt at what Gene etc. want
fastrk.928 think the agricultural piece is pretty strong. Gene wanted more specifics on what the
U.S. will lose out on in the future or currently. We need a lot more on services in that context as
well and I couldn't find anything on government procurement.
Let me know what you think and what you have. thanks.
Russell W. Horwitz
09/28/97 03:21:07 PM
Record Type:
Record
To:
mryckman @ ustr.gov @ INET @ LNGTWY
CC:
Eric R. Biel/WHO/EOP
Subject: Re: I have left messages with both Novick and Esserman to call
This is great! Gene will use these numbers for his Wall Street Journal lunch tomorrow. I'll start to
put these numbers in a one-pager. thanks for your help.
mryckman @ ustr.gov
09/28/97 12:57:00 PM
Record Type: Record
To:
Eric R. Biel, Russell W. Horwitz
CC:
Subject: Re: I have left messages with both Novick and Esserman to call
I have a few more numbers, but still need to work with David Walters early on Monday to get the
world market figures. Hope these help.
From our APEC office on sectorals all are 1996 numbers.
Sector
Estimated US exports to World Est. US exports to APEC
Chemicals:
$69.4 billion
$41.3 billion
Medical equipment:
$11.7 billion
$4.8 billion
Automotives
$98.4 billion
$71.2 billion
Telecomm equip
$11.4 billion
$7 billion
Forest products
$25.4 billion
$3.1 billion
envirnonmental goods
$5.3 billion
$3.1 billion
environmental services
will get
will get
fish and fish products
$3 billion
$2.6 billion
non-ferrous metals
$8.2 billion
$6.3 billion
civial aircraft and parts
$29.4 billion
$14.8 billion
From the sectoral fact sheets in the Blue Book from the President's 9/10 event
energy equipment US exports to the world $15.5 billion in 1996
environmental technologies and services US exports to the world $14.5 billion in 1996, global
market estimated at $440 billion and growing
»» <Eric_R. [email protected]> 09/26/97 05:27pm »»
Message Creation Date was at 26-SEP-1997 18:27:00
Here is what we have so far, I think, based on Linda Eddleman's conversations
with USTR and a few other things we dug up over here of possible relevance:
Upcoming WTO negotiations:
Agriculture: $60 billion in U.S. exports, $600 billion total world market
Commercial services: $250 billion in U.S. exports, $1.2 trillion world market
Government procurement: $200 billion in U.S. exports, $1 trillion world market
(All numbers to be checked again; fourth area of future WTO negotiations --
intellectual property rights -- is not subject to quantification in the same
way.)
Eric R. Biel
........
09/26/97 06:27:01 PM
Record Type:
Record
To:
Russell W. Horwitz/OPD/EOP
CC:
mryckman @ ustr.gov @ INET @ LNGTWY
Subject: Re: I have left messages with both Novick and Esserman to call me
Here is what we have so far, I think, based on Linda Eddleman's conversations with USTR and a
few other things we dug up over here of possible relevance:
Upcoming WTO negotiations:
Agriculture: $60 billion in U.S. exports, $600 billion total world market
Commercial services: $250 billion in U.S. exports, $1.2 trillion world market
Government procurement: $200 billion in U.S. exports, $1 trillion world market
(All numbers to be checked again; fourth area of future WTO negotiations -- intellectual property
rights -- is not subject to quantification in the same way.)
Costs of inaction: getting beyond the specific examples/anecdotes, in Chile alone we have already
lost an estimated $500 million in exports to other countries that have duty preferences already in
place (source: AmCham of Chile).
MERCOSUR (Brazil, Argentina, Paraguay, and Uruguay) has total GDP exceeding $1 trillion-- though
I realize that figure alone doesn't help much with "cost of inaction" analysis. Maybe we could
calculate, for example, how much the tariffs of 8-20% imposed on our key ag. exports to
MERCOSUR will cost us over a set number of years. More data needed first, however.
10/01/97
11:26
2024562223
WHITE HOUSE/NEC
001
***
ACTIVITY REPORT
***
TRANSMISSION OK
TX/RX NO.
6975
CONNECTION TEL
62878
CONNECTION ID
START TIME
10/01 11:25
USAGE TIME
00'45
PAGES
2
RESULT
OK
10/01/97 WED 09:21 FAX 202 647 0892
STATE DEPT
002
USIK GENEVA
STATE LB TDC MTA 01/001
01/10 97 14:02
URGENT
Oct. 1, 1997
David/Mary Jo:
SUBJECT: Additional procurement points for the White House on Fast Track
Rebecca Reese, Mark Linscott and I believe that it. is safe to draw on the following Doints
to add to the draft fact sheet. Please note that the $600 billion world market number at
the top of the GP section is conservative; we believe that the total procurement markets in
the US and the EU alone is around $600 billion per year. CB's Sept 17 testimony (page
5) estimates that the world's government procurement market will be a 1 trillion dollar
market.
0
Improving and expanding the coverage of WTO rules on government procurement
will facilitate U.S. efforts to improve our access to the lucrative infrastructure
project now planned or underway in the rapidly growing regions of the world.
The W IU's Agreement on Government Procurement (GPA) already covers over
$400 billion in annual procurements among the 25 members of the GPA Under
the WTO's built-in-agenda. negotistions are set to begin in 1993 which should
increase the number of GPA members and to increase the amount of covered
procurements in GPA countries, so that the amount of WTO-covered procurement
could approach $1 trillion per year.
Fast Traok is needed to negotiate government procurement agreements as part of
the FTAA and APEC, which will open the rapidly growing procurement markets
of Latin America and Asia to U.S. firms. We estimate that Asia alone will provide
opportunities for up to $1 trillion in business for infrastructure projects over the
next decade. (from Cherlene's CD's 3/18/97 testimony before Ways and Means, page 6)
Dill Crall Craft
10/1/97 GPfasttrk.doc
The White House
National Economic Council
To: Russ
Phone: 65715
Fax: 62878
From: ERIC
Phone: (202) 456-6630 Fax: (202) 456-2223
Pages including cover sheet: 2
Comments:
state (No. OK procklement
not much additional 1st
some clartration on $ amounts
$
10/01/97 WED 09:21 FAX 202 647 0892
STATE DEPT
001
DEPARTMENT OF STATE
TRADE POLICY AND PROGRAMS
ROOM 3831A
Washington, DC
(202) 647-2532
Fax: (202) 647-1537
FAX TRANSMISSION
Date: 10/1/97
To: ERiC Biel
Fax: 456-2023 Phone: 456-5370
Pages including cover sheet:
From:
David Marchick
Subject:
Points on Government Procurement
Comments:
as Dis cussed
The White House
National Economic Council
To:
Dave Marmek-Ske -
Phone: 697-2532
Fax: 617-1537
From: ERICKEL
H
X65115
5370
Phone: (202) 456-6630 Fax: (202) 456-2223
Pages including cover sheet: &
Comments:
AS discussed
(Russ HAWITZ deft
for Gere 5.)
EB
WHY AMERICA WON'T GET ITS FAIR SHARE OF JOBS WITHOUT FAST TRACK
The U.S. needs to maintain its leadership role in opening markets through tough, fair trade
agreements.
Since 1992, 49 states have experienced an increase in overall goods exports and 45
states have experienced an increase in jobs supported by trade.
46 states have higher exports to Mexico and 47 states have higher exports to
Japan.
America needs fast track to continue to create higher-paying jobs for more Americans. Without it,
America's role as the largest exporter in the world will be put in jeopardy. And with more markets
opening in the world, it is now more important than ever to give the President traditional trade
authority to break down trade barriers for American goods and services.
In the upcoming WTO negotiations, President Clinton needs fast track to have the flexibility to
negotiate agreements in agriculture, commercial services and government procurement. In each
of these areas, the U.S. is the most competitive nation in the world and stands to benefit the most from
writing the rules of trade.
AGRICULTURE
The U.S. is the world's largest agricultural exporting country -- shipping a record $60 billion in
exports abroad. In 1996, total world agricultural exports totaled $600 billion. U.S. exports accounted
for 10% of that -- $60 billion -- the highest ever.
U.S. agricultural exports support nearly a million jobs and this number is rising.
Since 1990, the value of U.S. agricultural exports has increased by $20 billion, or
nearly 50%. Each week last year, on average, American producers and processors
shipped out more than $1.1 billion in farm and food products to foreign markets.
Last year, our agricultural exports were twice the level of our agricultural imports
-- a claim no other industry sector can make. Dollar for dollar, we export more corn
than coal, more wheat than steel, more meat than aluminum and more fruits and
vegetables than CD's, records, and tapes. U.S. exports are growing more than three
times as fast as domestic demand for foods.
U.S. agriculture will pay a price if fast track is not granted.
More than 30 bilateral and regional trade agreements are already operating here
in the Western Hemisphere, and the U.S. is party to only one -- NAFTA. While
these preferential trade agreements multiply, the U.S. share of the region's total
agricultural imports is declining.
Chile has already signed trade agreements with Bolivia, Colombia, Ecuador,
Mexico, Venezuela, MERCOSUR and most recently Canada. The U.S. has
already lost an estimated $500 million in exports to other countries that have
duty preferences already in place.
Chilean fresh fruit pays a 2% duty when entering Venezuela (due to the Chile-
Venezuela FTA) whereas American producers pay a 15% tariff. The U.S.
Embassy estimates that the U.S. market share would grow from its current 39%
to 67% if U.S. producers had equivalent access to the Venezuelan market.
(WE NEED MORE HERE)
Without fast track, the U.S. will lack credibility to push for a fast start on WTO
agricultural negotiations scheduled to start at the end of 1999. Agriculture remains one of
the most protected and subsidized sectors in the world economy. American exports still
continue to face trade barriers through high tariffs and preferential trade deals that exclude the
U.S. Already, since 1992, in Latin America and Asia alone, our competitors have
negotiated 20 trade agreements that do not include the United States.
Country:
Pre-Uruguay:
Post-Uruguay
Colombia
14.5%
10.9%
Brazil
21.8%
11.7%
Peru
27%
14.6%
Venezuela
15%
12.4%
Argentina
14.5%
10.4%
Uruguay
24%
14.6%
The best way we can continue to increase our agricultural exports and create more higher-
paying jobs is through broad negotiations where the U.S. has the ability to seek additional
commitments from other countries.
COMMERCIAL SERVICES
Exports of services by U.S. firms supported an estimated 3.9 million U.S. jobs in 1996. U.S.
service exports have more than doubled over the last ten years, increasing $135 billion since 1987 and
$84 billion since 1990 to $250 billion in 1996. In 1995, U.S. service exports accounted for 16% of
global service exports; our closest competitors that year were France (8%) and Germany, Italy, Japan
and the U.K. (between 5% and 6%).
U.S. exports to emerging markets have grown at impressive rates: nearly 30% to
China, Taiwan and Korea; and over 20% to Hong Kong and Argentina. The U.S. also
exported over $1 billion in 1995 to the emerging markets of Argentina, Brazil, China,
Hong Kong, the Philippines, India, Indonesia, Korea, Malaysia, Singapore and
Thailand.
Service exports are estimated to reach $300 billion by 2005 and $350 billion by
2010. With the expanding electronic commerce market, the growth trend in the service
sector may easily surpass these estimates. For example, look at the health care services
industry. In 1994, exports reached $812 million. The industry is estimated to grow to
$1.03 billion by 1998 and continue its growth to $1.4 billion by 2002.
Unless negotiated away, barriers will inhibit increased U.S. service exports. In
Korea, a number of service sectors remain restrictive for foreign investment, including
audio-visual services, insurance, telecommunications and advertising. Brazil has
restrictive investment laws, lack of transparency in administrative procedures and limits
on foreign capital participation. Distribution in the domestic market is restricted in
Indonesia.
Fast track will strengthen U.S. efforts to reduce trade barriers and expand
international markets, which will be key to maintain U.S. competitiveness and
innovation.
GOVERNMENT PROCUREMENT
$200 billion in U.S. exports in 1996, $600 billion total world market.
Korea: $20 billion civil aviation purchase planned
Thailand: $22 billion power plan purchase planned
Brazil: $10 billion in environment technologies purchase planned
Venezuela: $1.3 billion civil aviation purchase planned
ADDITIONAL SECTORS
Sector
Estimated US exports to World
Est. US exports to APEC
Chemicals:
$69.4 billion
$41.3 billion
Medical equipment:
$11.7 billion
$4.8 billion
Automotives
$98.4 billion
$71.2 billion
Telecomm equip
$11.4 billion
$7 billion
Environmental goods
$5.3 billion
$3.1 billion
Fish and fish products
$3 billion
$2.6 billion
Non-ferrous metals
$8.2 billion
$6.3 billion
Cival aircraft and parts
$29.4 billion
$14.8 billion
Energy Equipment
US exports to the world $15.5 billion in 1996
Environmental technologies and services
US exports to the world $14.5 billion in 1996, global
market estimated at $440 billion and growing